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Chapter Three
Chapter Three
Digitizing the Business:
e-Business Patterns
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© e-Business Strategies,
Inc.
e-Channel
e-Channel
e-Portal
e-Portal
e-Market Maker
e-Market Maker
e-Business Patterns:
e-Business Patterns:
The Structural Foundation
The Structural Foundation
Pure-E “Digital Products”
Pure-E “Digital Products”
Click-and-Brick
Click-and-Brick
Table of Contents
Table of Contents
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e-Business Patterns: Structural Foundation


e-Business Patterns: Structural Foundation
In dynamic market environment, manager’s
challenge is how to tell forest from trees

Are we investing in the right business opportunity?

Are these opportunities ever going to be useful?

Are we using the right business model to attack
these opportunities?
The Scoop: New, Web-enabled firms eating into
large, old-economy companies’ businesses
So: Managers of old-economy companies need
right support tools to make strategic moves,
allocate scarce resources, and manage risk
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© e-Business Strategies,
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e-Business Patterns: Structural Foundation
e-Business Patterns: Structural Foundation
But: Choosing target strategy complex

To move online, large brick-and-mortar corporations
either swallow a startup or go at it alone. Which is
the right approach?
Implication: With focus shifting from physical to
digital assets, managers must monitor
macroeconomic and customer trends


To trigger new e-business structural designs

Resulting new business models form the basis for
next gen corporate strategic planning
Sadly: Many companies still not taking the digital
world seriously
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© e-Business Strategies,
Inc.
e-Business Patterns: Structural Foundation
e-Business Patterns: Structural Foundation
Bottom line: We are still in early stages of the e-Business
revolution

There have been and will be moments of extreme optimism;
also moments of extreme pessimism

What is certain is that it is creating opportunities for
companies willing to adapt

For others, it represents a destabilizing threat to the status
quo of business-as-usual

When all is said and done, we’ll find big corporate winners
join ranks of premiere companies in the world
Aim of this chapter


Help identify winners

Discuss characteristics leading to their success

Analyze discernible patterns for better understanding
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© e-Business Strategies,
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Going Digital
Going Digital
First step in identifying an e-business leader

Look at companies asking the innovative questions that are
transforming the rules of today’s business game
When innovative companies change the types of strategic
questions that they ask themselves, the result is business
revolution

In 1970s, the Japanese posed new questions and changed
rules of the Auto industry

Not gas-guzzlers, how do we create fuel-efficient cars?

Not cars that break down, how can we create a high-
quality car with few manufacturing defects?

Not piles of “just-in-case” inventory, how can we create a
“just-in-time” inventory process?

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© e-Business Strategies,
Inc.
Going Digital
Going Digital
In mid 1980s, it was Wal-Mart

Not what business are we in, what business should we be
in?

Wal-Mart turned from retailer into supply chain expert

Offered right product mix at right store
In mid 1990s, it was new entrants who rose to challenge
almost every leading company

Questions about customer and business model, not
processes, thus challenging sentiment of early 1990s among
leading companies

AOL vs. CompuServe and Prodigy

Dell vs. Compaq and IBM

EMC vs. IBM and StorageTek

Sun Microsystems vs. HP and Silicon Graphics
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© e-Business Strategies,
Inc.
Going Digital
Going Digital
In the 2000s, the questions for today’s business
leader will be on the speed with which his/her
firm implements e-business solutions powered
by recent innovations

How fully digital can we make our customers’
experience?

Our supply chain?

Our internal operations and processes?

Intuit transformed from a stand-alone PC-based
business model into an online financial services
portal when the Internet emerged to threaten it’s
business
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© e-Business Strategies,
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Going Digital
Going Digital
Startups continue to shape the direction of

today’s business by taking advantage of recent
technological innovations
E-Business can change the way companies
interact with customers, communicates, sells,
purchases, manufactures, and develops
products
Asking a new question not only produces new
answers but also reinvents the game
Result: a cost advantage that’s not 10 percent
better than competitor’s but rather many fold.
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© e-Business Strategies,
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What models are better suited to take advantage of new
business opportunities?

What business processes need to change?

How do you move from existing model to an e-model
reflecting your firm’s organizational readiness?

What are the challenges management must face when
executing the new business model?
Analyzing the Environment
Analyzing the Environment

What is the new opportunity based on certain

customer and market trends?

What are the macro-economic drivers of the
business change?

Which digital technologies are going to dominant
your industry?
e-Business Models
The strategic framework
allows you to compete
in the game
e-Business Patterns
The structural
foundation sets the
new rules of the game

Who are your target customers?

What is your value proposition?

How do you make money?

How to finance the company?

How do you get and retain customers?

How to attract and retain talented people?
e-Business Designs
A specific strategy for
what you need to do in

the marketplace
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© e-Business Strategies,
Inc.
Focusing on the Whole Picture
Focusing on the Whole Picture

Basic efficiency,
effectiveness
enhancements
as the selling
becomes E-enabled

Selling
goods/services

Payment/settlement
enhancements

Traditional business
transferred to the
Net

Rise of new
intermediaries

New forms of supply
chain integration


Consolidation/
transformation of
intermediary
industry

Customer Expects
“E” everywhere

Fundamental re-
design
of business

New structures to
allow market making,
trading and virtual
warehousing
Begins as a Channel, But Extends to
Total Transformation of Business
Pure E
E-Portal
(B2C)
E-Market-Makers
(B2B)
e-Channel
Click and Brick
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com
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© e-Business Strategies,

Inc.
e-Channel
e-Channel
e-Portal
e-Portal
e-Market Maker
e-Market Maker
e-Business Patterns:
e-Business Patterns:
The Structural Foundation
The Structural Foundation
Pure-E “Digital Products”
Pure-E “Digital Products”
Click-and-Brick
Click-and-Brick
Table of Contents
Table of Contents
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com
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© e-Business Strategies,
Inc.
Transaction
Transaction
Enhancement
Enhancement
Transaction
Transaction
Enhancement
Enhancement

e-Channel
e-Channel
Compression
Compression
e-Channel
e-Channel
Compression
Compression
e-Channel
e-Channel
Expansion
Expansion
e-Channel
e-Channel
Expansion
Expansion
e-Channel
e-Channel
Innovation
Innovation
e-Channel
e-Channel
Innovation
Innovation
e-Channel
e-Channel
Table of Contents
Table of Contents
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com

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© e-Business Strategies,
Inc.
Transaction Enhancement
Transaction Enhancement
Augments or replaces the old transaction method

Home Depot
In most cases, does not alter other aspects of the process
Sometimes, more technically savvy companies may gain
business from other firms, thereby altering the identify of
players in the channel

Dell

Gap
Consumer
Electronic Transaction
Manufacturer

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